Tax Document Library - What to do with these VAT Documents?
US-based seller here.
What is the purpose of the “Fulfillment by Amazon Tax Invoice” and the “Merchant VAT Invoice” in the Tax Document Library section of Seller Central? The “Fulfillment by Amazon Tax Invoice” shows fees paid to Amazon FBA, while the “Merchant VAT Invoice” shows referral and subscription fees.
What is the purpose or effect of these transactions if the VAT rate on these transactions is 0%? What should I do with these documents and why am I receiving them?
0 replies
Seller_qZO3ZCjoBXEeL
I take it that you are registered for VAT since you are being charged at zero VAT?
You need to self account for the VAT charges when you file your UK VAT returns. Basically because Amazon is billing you from another EU location VAT does not have to be charged at source, but you do have to self account for it in your own VAT returns.
I cannot talk you through the specifics of how to do that, your UK accountant will be able to help.
Seller_UmiN1IyD9F9EV
I have the same query.
The invoices generated for seller fees are specific to either FBA or Seller Fulfilled Sales,hence the slight difference in the way they are worded, but as far as i’m aware, as amazon is located in Luxembourg they are zero rated…
Surely you claim for VAT you havnt actually paid?
Seller_fMCcsFEvto8pM
Someone check this:
For every £1 (VAT inclusive price) sold on Amazon.co.uk:
- HMRC receives about £0.17 on the item price
- Amazon receives about £0.15 (in 15% referral fee categories)
- HMRC receives an additional £0.03 on the Amazon referral fee
The seller receives about £0.65 of every £1.00 sold, even before item costs, inbound shipping, FBA, and other business expenses.
Now let’s make some assumptions:
- Item cost is about 10%, so £0.10 for our example
- Inbound shipping is about 5%, so £0.05 for our example
- FBA is about 6%, so £0.06 for our example
- Other business expenses are maybe 4%, so £0.04 for our example
The £0.65 we had after VAT and referral fees is now £0.40. So for every £1.00 sold on Amazon, the seller, when selling at a 900% markup, receives £0.40.
Seller_saK5Ah2SaNYjL
You can’t claim the same profit and loss from foreign countries, it’s that simple.
It stings my heart when I have to pay EUR4,000 in German VAT when I know they have born no product costs but that’s they way it is. I claim all that VAT back from the UK.
My UK VAT obligation has reduced considerably since going PAN EU.
Seller_fMCcsFEvto8pM
Do they teach Tax Law as a regular class throughout primary and secondary education in Europe? I mean where is a sole trader to learn that “failing to report what you don’t owe” results in penalties?
Tax Document Library - What to do with these VAT Documents?
US-based seller here.
What is the purpose of the “Fulfillment by Amazon Tax Invoice” and the “Merchant VAT Invoice” in the Tax Document Library section of Seller Central? The “Fulfillment by Amazon Tax Invoice” shows fees paid to Amazon FBA, while the “Merchant VAT Invoice” shows referral and subscription fees.
What is the purpose or effect of these transactions if the VAT rate on these transactions is 0%? What should I do with these documents and why am I receiving them?
Tax Document Library - What to do with these VAT Documents?
US-based seller here.
What is the purpose of the “Fulfillment by Amazon Tax Invoice” and the “Merchant VAT Invoice” in the Tax Document Library section of Seller Central? The “Fulfillment by Amazon Tax Invoice” shows fees paid to Amazon FBA, while the “Merchant VAT Invoice” shows referral and subscription fees.
What is the purpose or effect of these transactions if the VAT rate on these transactions is 0%? What should I do with these documents and why am I receiving them?
0 replies
0 replies
Seller_qZO3ZCjoBXEeL
I take it that you are registered for VAT since you are being charged at zero VAT?
You need to self account for the VAT charges when you file your UK VAT returns. Basically because Amazon is billing you from another EU location VAT does not have to be charged at source, but you do have to self account for it in your own VAT returns.
I cannot talk you through the specifics of how to do that, your UK accountant will be able to help.
Seller_UmiN1IyD9F9EV
I have the same query.
The invoices generated for seller fees are specific to either FBA or Seller Fulfilled Sales,hence the slight difference in the way they are worded, but as far as i’m aware, as amazon is located in Luxembourg they are zero rated…
Surely you claim for VAT you havnt actually paid?
Seller_fMCcsFEvto8pM
Someone check this:
For every £1 (VAT inclusive price) sold on Amazon.co.uk:
- HMRC receives about £0.17 on the item price
- Amazon receives about £0.15 (in 15% referral fee categories)
- HMRC receives an additional £0.03 on the Amazon referral fee
The seller receives about £0.65 of every £1.00 sold, even before item costs, inbound shipping, FBA, and other business expenses.
Now let’s make some assumptions:
- Item cost is about 10%, so £0.10 for our example
- Inbound shipping is about 5%, so £0.05 for our example
- FBA is about 6%, so £0.06 for our example
- Other business expenses are maybe 4%, so £0.04 for our example
The £0.65 we had after VAT and referral fees is now £0.40. So for every £1.00 sold on Amazon, the seller, when selling at a 900% markup, receives £0.40.
Seller_saK5Ah2SaNYjL
You can’t claim the same profit and loss from foreign countries, it’s that simple.
It stings my heart when I have to pay EUR4,000 in German VAT when I know they have born no product costs but that’s they way it is. I claim all that VAT back from the UK.
My UK VAT obligation has reduced considerably since going PAN EU.
Seller_fMCcsFEvto8pM
Do they teach Tax Law as a regular class throughout primary and secondary education in Europe? I mean where is a sole trader to learn that “failing to report what you don’t owe” results in penalties?
Seller_qZO3ZCjoBXEeL
I take it that you are registered for VAT since you are being charged at zero VAT?
You need to self account for the VAT charges when you file your UK VAT returns. Basically because Amazon is billing you from another EU location VAT does not have to be charged at source, but you do have to self account for it in your own VAT returns.
I cannot talk you through the specifics of how to do that, your UK accountant will be able to help.
Seller_qZO3ZCjoBXEeL
I take it that you are registered for VAT since you are being charged at zero VAT?
You need to self account for the VAT charges when you file your UK VAT returns. Basically because Amazon is billing you from another EU location VAT does not have to be charged at source, but you do have to self account for it in your own VAT returns.
I cannot talk you through the specifics of how to do that, your UK accountant will be able to help.
Seller_UmiN1IyD9F9EV
I have the same query.
The invoices generated for seller fees are specific to either FBA or Seller Fulfilled Sales,hence the slight difference in the way they are worded, but as far as i’m aware, as amazon is located in Luxembourg they are zero rated…
Surely you claim for VAT you havnt actually paid?
Seller_UmiN1IyD9F9EV
I have the same query.
The invoices generated for seller fees are specific to either FBA or Seller Fulfilled Sales,hence the slight difference in the way they are worded, but as far as i’m aware, as amazon is located in Luxembourg they are zero rated…
Surely you claim for VAT you havnt actually paid?
Seller_fMCcsFEvto8pM
Someone check this:
For every £1 (VAT inclusive price) sold on Amazon.co.uk:
- HMRC receives about £0.17 on the item price
- Amazon receives about £0.15 (in 15% referral fee categories)
- HMRC receives an additional £0.03 on the Amazon referral fee
The seller receives about £0.65 of every £1.00 sold, even before item costs, inbound shipping, FBA, and other business expenses.
Now let’s make some assumptions:
- Item cost is about 10%, so £0.10 for our example
- Inbound shipping is about 5%, so £0.05 for our example
- FBA is about 6%, so £0.06 for our example
- Other business expenses are maybe 4%, so £0.04 for our example
The £0.65 we had after VAT and referral fees is now £0.40. So for every £1.00 sold on Amazon, the seller, when selling at a 900% markup, receives £0.40.
Seller_fMCcsFEvto8pM
Someone check this:
For every £1 (VAT inclusive price) sold on Amazon.co.uk:
- HMRC receives about £0.17 on the item price
- Amazon receives about £0.15 (in 15% referral fee categories)
- HMRC receives an additional £0.03 on the Amazon referral fee
The seller receives about £0.65 of every £1.00 sold, even before item costs, inbound shipping, FBA, and other business expenses.
Now let’s make some assumptions:
- Item cost is about 10%, so £0.10 for our example
- Inbound shipping is about 5%, so £0.05 for our example
- FBA is about 6%, so £0.06 for our example
- Other business expenses are maybe 4%, so £0.04 for our example
The £0.65 we had after VAT and referral fees is now £0.40. So for every £1.00 sold on Amazon, the seller, when selling at a 900% markup, receives £0.40.
Seller_saK5Ah2SaNYjL
You can’t claim the same profit and loss from foreign countries, it’s that simple.
It stings my heart when I have to pay EUR4,000 in German VAT when I know they have born no product costs but that’s they way it is. I claim all that VAT back from the UK.
My UK VAT obligation has reduced considerably since going PAN EU.
Seller_saK5Ah2SaNYjL
You can’t claim the same profit and loss from foreign countries, it’s that simple.
It stings my heart when I have to pay EUR4,000 in German VAT when I know they have born no product costs but that’s they way it is. I claim all that VAT back from the UK.
My UK VAT obligation has reduced considerably since going PAN EU.
Seller_fMCcsFEvto8pM
Do they teach Tax Law as a regular class throughout primary and secondary education in Europe? I mean where is a sole trader to learn that “failing to report what you don’t owe” results in penalties?
Seller_fMCcsFEvto8pM
Do they teach Tax Law as a regular class throughout primary and secondary education in Europe? I mean where is a sole trader to learn that “failing to report what you don’t owe” results in penalties?
